Managed loan through debt collectors

zincoxide

My OH had a managed loan with HSBC who added shocking amounts of interest & penalty charges, this was then sent through to Metropolitan Collection Services.

My OH then agreed to pay back a total sum of £11,369.13 at £100pm until it is cleared.

They took off none of the interest or penalty charges and were extremely heavy handed with her, she has now been paying this back for about a year now.

Is there any way I can get her out of this debt or have it hugely reduced. Could I challenge any of it now she has been paying it?

dollindebt

Hi zinc, sorry to hear about this difficulty.
I had a £25,000 personal loan with HSBC (with the pp insurance) and two years into the loan, could not cope any more with the payments. This was in addition to owing 6600 on an HSBC gold card. They kept giving me credit, and I kept taking it! I also had other debts with other creditors. I had been a "good" customer of theirs for 9 years, with an unblemished record.
When I went into my branch, I broke down in tears (hysterics, actually) and told them I was in financial difficulty. They were actually quite kind about it, but did try to get me to take out a secured loan first. They then mentioned a managed loan. When I said no, I was going with Payplan, they seemed to have no idea what I was on about.
Eventually, after several months of Payplan (Payplan--wonderful!) making payments into my current account to make token payments towards the loan, my account was then passed to Metropolitan.
Previously, I actually had to go into my branch and tell them to PLEASE issue default notices and pass the account on to Metropolitan (which is actually part of HSBC) as my financial situation was not going to improve. Payplan had actually said that Metropolitan was quite good to deal with, which I have found to be true, in my case. Mysteriously, HSBC eventually knocked off an astounding £11,000 off the loan in interest and ppi payments. I did not expect this at all.
This probably will make you feel worse, but I thought I would share my experience. Do not give up hope, maybe they will knock off some interest after a few months of good payments with Payplan, as was in my case. Good luck.

dollindebt

Oops, just realised your OH has been making the payments to Metropolitan for a year. Perhaps you could write Metropolitan and bring this to their attention, and that would they consider dropping the interest. It certainly could not hurt to ask. Put it writing very nicely that the payments have been made on time for a year. Did she go from a loan to a managed loan and not keep up the payments, then it was passed on to Metropolitan? Or did they agree to the managed loan and pass it on to Metropolitan anyway?

dollindebt

Also meant to say that when I went to Payplan, the pay-off figure for the loan of £25,000 had ballooned to £37,000 with interest etc. That's the original figure the interest was knocked off on. I now owe just under £18,000. Still a lot, but a heck of a lot better than the amount with the interest etc still on. Again, it wouldn't hurt to write and ask them to knock it off. Ask Payplan to write them again to knock off the interest.

zincoxide

Metropolitan are not charging interest which is good, but the overall figure still includes the interest charges & penalty charges levied by HSBC when it was in their hands. Surely this could be reduced retrospectively?

inmypocketnottheirs

Penalty charges i.e. exceeding overdraft/returned cheques/returned direct debits are not enforceable. Visit https://www.bankchargeshell.co.uk and https://www.bankactiongroup.com for more information. I have had over £1300 refunded from the co-op bank.

Good luck

burbs_2

zincoxide wrote:

My OH had a managed loan with HSBC who added shocking amounts of interest & penalty charges, this was then sent through to Metropolitan Collection Services.

My OH then agreed to pay back a total sum of £11,369.13 at £100pm until it is cleared.

They took off none of the interest or penalty charges and were extremely heavy handed with her, she has now been paying this back for about a year now.

Is there any way I can get her out of this debt or have it hugely reduced. Could I challenge any of it now she has been paying it?

The problem is the statement you make about your OH agreeing to pay back the total sum of £11,369.13 at £100 a month. She could have fought the interest and other charges being added with HSBC before she agreed to this but now it is out of their hands and in the hands of the collection company.

Now she has been paying for a year i cannot see the agency letting her off with those charges and dont think she would have much of a chance. I would however still write a letter to them and see what they say but i cannot see there being a happy conclusion for you unfortunatly. Good luck though

dollindebt

As Metropolitan is part of HSBC there may still be a chance of getting some of the interest knocked of retrospectively. Worth a try! All the best.

Headdown_2

Abbey bank recently lost a high profile case on penalty charges imposed on a customer. IIRC the judge awared the customer 5 times the amount he was claiming back, it sent out a signal to the financial services sector that charges like this are punitive and charging them could prove more costly to them in the end.

As with all these debt/penalty related issues the financial sector plays on the lack of knowledge amongst consumers who assume that because they have been charged it, they MUST pay it. These charges are pernicious and only heap more agony onto an already poor situation.

I was with my bank for over 25 years with an unblemished record, I ended up in a financial mess due to losing my job during the last year with my bank. Their 'help' in this matter was to load my account with charges and sky high interest. In the old days when you had a bank manager at your branch you could talk it over, nowadays banking is centralised and you are fed a diet of call centre staff you have no 'relationship' with and their knowledge of you extends to a small box on their screen. This is magnified by an automated mail system that spews out a stream of standard letters that take no account of action you may have taken or agreed.

How many times a week do you get 'you have ignored our request for payment' type letters, when you have been in contact with the DCA or lender on an ongoing basis?

loubie_lou

Barclays Bank are increasing their charges to £35 for any late payments/bounced DD's etc.

Glad I'm binning them in two months.